How you accept payments from your customers probably isn’t an area you spent a lot of time researching. For businesses in many industries, #manualbanktransfers are simply thought of as the default way of getting paid.

But businesses that don’t optimise their method of accepting payment commonly create these ongoing problems for themselves:

1. Late payments

By relying on your customers to manually pay you. Around the world, only about 35% of payments made to small businesses are made on time and without requiring follow up.

2. Additional admin and wasted time

By not automating parts of the payment process that are easily automated. #Globally, the average small business spends 4.9 hours per month on payment reconciliation – a task that can be easily automated.

3. Unnecessary stress

Due to the #cashflow impact from late payments, and time wasted on manual admin that could be automated. And it’s no surprise, with the average small business spending 5.8 hours per month chasing up late payments.

In the best case, these issues are frustrating or upsetting. And in the worst case, they can stop business growth entirely, or drive you to insolvency.

But you can solve them. All it takes is exploring which payment method is best for your business.

How to optimise your payments

When it comes to collecting payment from your customers, there are several online payment options available to you, other than manual bank transfers:

  • #DirectDebit
  • #Instantbankpayments (using open banking)
  • #Credit or debit cards
  • #Digitalwallets

The table below explores the pros and cons of each of these methods, to help you pick what’s right for you.

Payment method

Pros

Cons

Manual bank transfers

  • Free or very low fees (but can cost you through admin like chasing late payments and reconciliation)
  • Very low chance of transaction failing
  • High manual admin cost
  • Fully reliant on customer to pay on time
  • No notification about late, missed, or failed payments

Direct Debit (using our payments partner GoCardless)

  • Low fees
  • Low chance of transaction failing
  • Low manual admin cost (can automate payments to occur on invoice due date)
  • Notifications about late, missed, or failed payments
  • Payment confirmation isn’t instant

Instant bank payments (using open banking)

  • Instant payment confirmation
  • Low fees
  • Low chance of transaction failing
  • Prompts customer to make payment
  • Notifications about late, missed, or failed payments
  • Requires customer to manually approve payment

Credit or debit cards

  • Instant payment confirmation
  • Low manual admin cost (can automate payments to occur on invoice due date)
  • Notifications about late, missed, and failed payments
  • High fees
  • Higher chance of transaction

failing

  • Cards can get lost, stolen, or expire

Digital wallets (e.g. PayPal)

  • Instant payment confirmation
  • Low manual admin cost (can automate payments to occur on invoice due date)
  • Notifications about late, missed, or failed payments
  • High fees
  • Higher chance of transaction failing
  • Cards attached to digital wallets can get lost, stolen, or expire

Optimise your payments today

#Latepayments, and the time you spend on payments admin, aren’t #one-time problems. They reoccur every #billingcycle. The sooner you address the real cause of these problems – by choosing the right #paymentmethod to offer your customers – the greater the benefit you’ll get.

 MYFUNDBOX Subscription Billing connects with several major payment platforms, including:

Click through to learn more about how each platform works, and how you can get started using them.